Scribd
Upload
23 views

Week 8 Fall2014Assign

The document provides financial information to calculate internal rate of return (IRR), net present value (NPV), and goodwill for an asset purchase. It includes equipment purchase amounts, revenue figures for 5 years, a 15% interest rate for NPV calculation, asset values and purchase price for the acquisition. The document requests calculations of IRR, NPV, goodwill, and the overall purchase price based on the information provided.

Uploaded by

Bethi Sandeep Kumar
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
23 views

Week 8 Fall2014Assign

The document provides financial information to calculate internal rate of return (IRR), net present value (NPV), and goodwill for an asset purchase. It includes equipment purchase amounts, revenue figures for 5 years, a 15% interest rate for NPV calculation, asset values and purchase price for the acquisition. The document requests calculations of IRR, NPV, goodwill, and the overall purchase price based on the information provided.

Uploaded by

Bethi Sandeep Kumar
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
You are on page 1/ 20

In the appropriate columns below to

the right calculate the IRR and NPV


using the following figures: 20,000
equipment purchase, yr. 1 rev. 7,000,
yr. 2, 8,000, yr.3 5,000, yr. 4, 4,000
and yr. 5, 3,000. For net present
value (NPV) assume a 15% interest
rate. In both cases, use the $ 20,000
as a negative first number.

Internal
Rate of
Return
IRR

Net Present
Value
15%
NPV

In the appropriate columns below to


the right calculate the IRR and NPV
using the following figures: 20,000
equipment purchase, yr. 1 rev. 7,000,
yr. 2, 9,000, yr.3 5,064, yr. 4, 4,000
and yr. 5, 3,000. For net present
value (NPV) assume a 15% interest
rate. Your formula's have to be
correct

Calculate goodwill on an asset


purchase based on the
following figures: AR cost
50,000 fmv 50,000. Inventory
cost 100,000 fmv 100,000, Land
cost 75,000 fmv 100,000;
building cost 500,000 depn
100,000 fmv 600,000,
Equipment cost 25,000 fmv
25,000 The discounted cash
flow projection is 75,000 each
year for 5 years assume a 20%
discount rate.
Based on the above and
goodwill calculation, calculated
the purchase price. Round the
goodwill figure to the nearest
$5,000. For example 129,442
would be 130,000.

Record the purchase calculated in the


goodwill. The purchase is for cash.

Define DSO in the box below in black and


calculate DSO and the following
information. Accounts Receivable end
yr. 1: 125,000; end yr 2; 75,000. Credit
Sales 1,000,000

Based on the balance sheet, please prepare the current ratio and quick ratio
below, Show the formula then show the calculation.

Assets
Current Assets
Cash
Miscellaneous Supplies
Accounts Receivable
31,000
Allowance for Doubtful Accounts(3,000)
Inventory - Computers
Total Current Assets
Equipment - Network
Accum Depn
Equipment - Computers
Accum Depn
Office Furniture & Fixtures
Accum Depn
Software
Accum Depn
Total long-term assets
Total Assets

Liabilities and
Current Liabilities
25,000
20,000
28,000
27,000
100,000
100,000
(1,667)
15,000
(250)
30,000
(500)
20,000
(333)
162,250
262,250

Long-term Debt

Stockholder Equity

Liabilities and Stockholder Equity

urrent Liabilities
Accounts Payable
Rent Payable
Accrued Interest Payable
Accrued Salaries & Wages Payable
Current Portion of Note Payable
Total Current Liabilities
ong-term Debt
Note Payable
Total Liabilities

ockholder Equity
Common Stock

15,000
0
2,084
25,000
7,352
49,436
251,648
301,084

Retained Earnings
Total Stockholder Equity

30,000
0
(68,834)
(38,834)

Total Liabilities and Stockholder Equity

262,250

500,000
251,648
248,352

Please Prepare a Cash Flow Analysis

Sample Balance Sheet


Assets
Cash
Accounts Receivable
Inventory
Other current assest
Total current assets
Property, plant and equipment
Other long-term assets
Total assets
Liabilities
Accounts payable
Short-term debt
Total Current liablities
Long-term debt
Total Liabilities
Shareholders' Equity
Common stock
Retained earnings
Total stockholder's equity
Total Liabilities & stockholders' Equity

Sales

12/31/2013

12/31/2012

5,000
80,000
75,000
12,000
172,000
95,000
30,000
297,000

7,000
58,000
100,000
10,000
175,000
75,000
32,000
282,000

26,100
1,900
28,000
119,000
147,000

30,000
2,000
32,000
120,000
152,000

(3,900)
(100)

110,000
40,000
150,000
297,000

100,000
30,000
130,000
282,000

10,000
10,000

295,000
295,000

282,000
282,000

(22,000)
25,000
(2,000)
(20,000)
2,000

(1,000)

80,000

Sales
Cost of goods
Gross Profit
Salaries & Wag
Depreciation
Interest Expen
Taxes
Net Profit

Income Statement
Sales
Cost of goods sold
Gross Profit
Salaries & Wage
Depreciation
Interest Expense
Taxes
Net Profit

80,000
25,000
55,000
20,000
15,000 included in AP
5,000 included in AP
5,000
45,000
10,000

Cash Flow from operations is


Net change in fixed assets is
Depreciation is

63,000
5,000
15,000

The error in recording ck 499 relates


to rent expense. Prepare the
adjusting journal entry to correct this
mistake

COMPANY
Bank Reconciliation
December 31, 2013
Cash Balance per bank statement
Add: Deposits in transit
Less: Outstanding checks
No. 501
No. 502
No. 503
Adjusted cash balance per bank
Cash balance per books
Add:
Collection of NSF check

Less:

NSF check
Error in recording ck 499
Bank service charge
Adjusted cash balance per books

MPANY
conciliation
er 31, 2013
20,000
2,000
22,000
3,000
500
1,000

4,500
17,500
15,500

4,000
4,000
19,500
450
1,500
50

2,000
17,500

Fixed Costs are


Selling Price per Unit
Variable Cost per Unit

50,000
750
250

How many units need to be sold to Breakeven?


Show your analysis

You might also like